Canada to cut immigration levels in major reversal, Trudeau says

TORONTO – Canada is set to slash the number of immigrants that it welcomes, Prime Minister Justin Trudeau announced Thursday, in a sharp reversal for a country that bet big on immigration to boost economic prosperity and that has long cast itself as open to newcomers.

The about-face comes as public opinion polls show waning support for immigration amid concerns that it is exacerbating long-standing housing shortages, pushing up rents and deepening stresses on an already overburdened health care system.

Since his election in 2015, Trudeau has planned to steadily increase immigration levels. In 2022, Canada set record targets, in part to plug pandemic labor shortages. “Canada needs more people,” said Sean Fraser, then the immigration minister.

That approach has set Canada apart from the United States, where Republican presidential nominee Donald Trump has pledged mass deportations and blames migrants for crime and disorder, and from Europe, where anti-migrant sentiment has propelled far-right political parties to victory.

Now Trudeau’s government is rolling up the welcome mat – and admitting that it bungled the policy.

Canada is to admit 395,000 new permanent residents in 2025, a 21% drop from the target of 500,000 it set last year. That number will fall further to 380,000 in 2026 and 365,000 in 2027. All are below the goal of 485,000 set for this year.

Officials also introduced the country’s first targets for temporary residents such as international students and foreign workers. Their numbers are projected to fall by nearly 450,000 in 2025 and 2026. In 2023, approximately 800,000 people held that status here.

The changes mean that after several years in which Canada saw record population growth thanks mostly to immigration – Canada has been growing faster than its Group of Seven peers as well as countries with higher birth rates such as India – its population is projected to shrink 0.2%.

“Our immigration system has always been responsible and it has always been flexible,” Trudeau said at a news conference in Ottawa. But in attempting to address labor needs and maintain population growth, “we didn’t get the balance quite right.”

Reaction to the reversal has been mixed.

Robert Kavcic, director of economics at the Bank of Montreal, said in a note Thursday that the new immigration plan would “take stress off the economy and infrastructure that has become almost debilitating in recent years,” citing the housing sector in particular.

But more than 100 civil society groups, including several of Canada’s largest unions, criticized the U-turn.

“This government was elected on a pro-immigration platform and promised permanent resident status for migrant workers, students and undocumented people,” they said in a letter. “People across Canada are expecting these promises to be honored. Not delivering on them will be remembered at the ballot box.”

Immigration has long drawn high levels of public support here and been viewed as critical for offsetting the economic effects of low fertility rates and an aging workforce. That consensus, built over generations, has cut across the political spectrum.

But there have been signs that Canada’s consensus is at risk. Last week, an Environics Institute poll found that nearly 60% of Canadians agree that there is “too much immigration” – the highest share in a quarter-century and the fastest shift in a two-year period since it began asking the question in 1977.

“The latest findings suggest the balance of public opinion about the volume of immigration currently being admitted into the country has effectively flipped from being acceptable (if not valuable) to problematic,” the pollster said.

The poll found that more than two-thirds of Canadians agree that immigration has a positive economic impact. The biggest reason they gave for saying there is too much immigration is its impact on housing prices.

Shifting views have added to the troubles for Trudeau, whose Liberal Party trailed the Conservatives by double digits in the polls for more than a year, in part because of housing concerns. At a meeting of his caucus Wednesday, some Liberal lawmakers called on him to resign. He says he plans to stay.

Canada’s population grew by more than 1.2 million people in 2023 to over 40 million, up 3.2% from the year before – the highest annual increase since 1957. About 98% of that came from immigration.

By contrast, the United States grew by about 1.7 million people to more than 335 million, or 0.5%, in 2023, according to estimates from the U.S. Census Bureau. That’s in part because of rising immigration, the agency said.

Most of Canada’s population growth was driven by a massive influx of temporary migrants such as international students. Universities and colleges have sought to recruit them because they pay more tuition that domestic students.

Canada has more than 3 million temporary residents, about 7.2% of the country’s population. In 2022, they made up about 4%.

Critics, including some economists here, have complained that Canada has botched the management of a system that has long been a point of national pride by admitting too many immigrants too quickly without ensuring the infrastructure could accommodate them.

“It is easy to blame immigrants for everything,” Marc Miller, Canada’s immigration minister, said at a news conference Thursday. “It’s also undeniable that the volume of migration has contributed to affordability (challenges), but there’s some nuances there.”

Toni Gravelle, a deputy governor of the Bank of Canada, said in a speech before the Windsor-Essex Chamber of Commerce in December that immigrants have alleviated labor shortages.

Housing supply has not kept pace with the Canada’s demography, he added, but that’s also because of “structural challenges” such as zoning restrictions, permitting processes and a construction worker shortage. (Some fall under the purview of provincial and local governments.)

Amid the growing backlash, the government had begun to introduce measures to curb immigration.

It froze the number of permanent residents that it planned to welcome, announced a temporary limit on international student visas, and pledged to shrink the proportion of the population made up of temporary residents to 5% over three years.

Then came Thursday’s cuts.

The Canadian Chamber of Commerce praised the “government’s efforts to strengthen and ensure” the country’s immigration system but said those efforts will be “disappointing” for businesses that have “had to deal with abrupt and constant changes” to immigration policy.

“Immigration is a key driver of economic growth and our only source of workforce growth in the near future,” Diana Palmerin-Velasco, a senior director at the chamber, said in a statement. “The future of Canada depends on getting immigration right. We can do better.”